Employment Data Fuels Rally of Canadian Dollar

The Canadian dollar jumped today, rising more than 1% against some of its most-traded rivals, after the release of a better-than-expected employment report.

Canadian employers added 45,300 jobs in June. That was much more than analysts had predicted (11,400) and close to the previous month’s strong gain of 54,500. The unemployment rate unexpectedly fell from 6.6% to 6.5%.

The Ivey Purchasing Managers Index did not disappoint as well, climbing from 53.8 in May to 61.6 in June. The actual figure was better than the forecast reading of 57.7.

The favorable data fueled speculations that the Bank of Canada will raise interest rates as soon as the next week. The meeting will occur on July 12.

USD/CAD dropped from 1.2975 to 1.2893 as of 14:59 GMT today, trading near the lowest level since September 8. CAD/JPY climbed 1.3% from 87.21 to 88.34, touching the highest level since January 9. CAD/CHF surged 1.2% from 0.7396 to 0.7486 — the highest since April 18.

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